HomeMy WebLinkAboutMinutes - Water Utility Commission - 1/10/2011 r I RcivED �•
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MINUTES
ORO VALLEY WATER UTILITY COMMISSION
REGULAR SESSION
Monday, January 10, 2011
HOPI CONFERENCE ROOM
11000 N. LA CANADA DRIVE
Chair Powell called a moment of silence for the victims in Saturday's Tucson shootings.
CALL TO ORDER - AT OR AFTER 6:00 P.M.
ROLL CALL
PRESENT: Dave Powell, Chair
Rick Davis, Vice Chair
John P. Hoffmann, Commissioner
Robert Milkey, Commissioner
Richard Reynolds, Commissioner
Elizabeth Shapiro, Commissioner
Winston Tustison, Commissioner
STAFF PRESENT:
Philip C. Saletta, Director
Shirley Seng, Utility Administrator
David Ruiz, Engineering Division Manager
Robert Jacklitch, Project Manager
CALL TO AUDIENCE - At this time, any member of the public is allowed to address the
Water Utility Commission on any issue not listed on today's agenda. Pursuant to the
Arizona Open Meeting Law, individual Commissioners may ask Town Staff to review the
matter, ask that the matter be placed on a future agenda, or respond to criticism made by
speakers. However, the Water Utility Commission may not discuss or take legal action on
matters raised during "Call to Audience." In order to speak during "Call to Audience"
please specify what you wish to discuss when completing the blue speaker card.
There were no speakers.
Chair Powell introduced Russell Tast and his father both Oro Valley
residents. He mentioned that Russell was representing the Boys Scout merit badge group
and was present to observe the Water Utility Commission meeting.
1. APPROVAL DECEMBER 13, 2010 MINUTES Discussion and/or possible action.
Click here for Item #1
MOTION: A Motion was made by Commissioner Tustison and Seconded by
Commissioner Reynolds to accept approval of the December 13, 2010 minutes as
written. MOTION carried, 7-0.
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�1/10/2011 MINUTES 4 � • R UTILITY COMMISSION
2. COMPREHENSIVE CENTRAL ARIZONA PROJECT WATER DEVELOPMENT
PLAN (P. Saletta) Discussion and/or possible action regarding Oro Valley Water
Utility Comprehensive CAP Water Development Plan. Discussion may include
elements that should be considered in the plan, the timing of the proposed plan and
the framework for presenting information to Council and the Commission.
Discussions may include updates on the Northwest Water Providers, interim delivery
of CAP water through the Tucson Water System and other activities and studies
pertaining to the development of CAP water.
Click here for Item 2a Power Point Presentation
Click here for Item 2b Options & Preliminary Cost Estimates
Commissioner Hoffmann reported that the Renewable Water Resources Subcommittee
met Wednesday, January 5th to discuss the Comprehensive Central Arizona Project Water
Development Plan. Mr. Saletta presented various scenarios on growth and water delivery
options. He also discussed the pros and cons on each scenario.
Mr. Saletta presented a power point presentation regarding the Comprehensive Water
Resource Plan which primarily focused on CAP Planning issues as requested by the
Commission. Mr. Saletta presented slides 1 and 2 outlining the main goals and planning
process.
Graph 1 - OVWU Water Use and Supply 2007
-Illustrates high growth projections by 2025. Total Water Use Demand 17,000 AF includes
Alternative Water Resources: CAP Water and Reclaimed Water.
Graph 2 - OVWU Water Use and Supply - 2011
Illustrates groundwater usage and sustainable groundwater production of 5,500 AF per
year. Reclaimed Water and CAP TW Wheeling.
Graph 3 OVWU Water Use and Supply -2011 Scenario 2
Illustrates year 2010 Projected demand and 1% to 3% growth rate. The 1% to 3% growth
rate dramatically reduces the amount of demand in 2025 and illustrates increases up to
13,500 AF per year. This graph is broken down into incremental deliveries of 1,000, 1,500,
and 3,000 AF/YR for Tucson's CAP Water Wheeling. This first phase illustrates a total
delivery of 5,000 AF/YR of CAP water delivery.
Graph 4 OVWU Water Use and Supply - 2011 Scenario 3
Illustrates increments of 1,000, 1,500, 3,000 and 5,000 AF/YR Year 2022. Projected
demand 1% to 3% growth rate. Reclaimed Water demand expected to be 2,200 AF/YR,
Groundwater Production 8,000 AF/YR down to 4,000 AF/YR with gradual increase in the
first phase of CAP delivery.
OVWU Water Use and Supply - Scenario 3
Mr. Saletta pointed out incremental increases of 1,000, 1,500, 3,000 (Interim -TW) and
5,000 AF by year 2022. Growth rates 1 - 3%. The 1-3% growth rates are based on actual
water use.
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OVWU Water Use & Supply -2011 Scenario 1 - High Growth: Projected Demand 2% to
5% Growth Rate and OVWU CAP Delivery Demand estimated at 16,000 AF/YR.
Sequential increases 1,000 - 3,000 AF/YR (CAP TW Wheeling).
OVWU Water Use & Supply -2011 Scenario 3 - High Growth: Projected Demand 2% to 5%
Growth Rate and OVWU CAP Delivery Demand estimated at 16,000 AF/YR. Sequential
increases 1,000 - 3,000 AF/YR (CAP TW Wheeling).
Mr. Saletta mentioned that CAP deliveries were based on reductions from what the original
numbers and also based on the economic outlook. If we do not experience the higher
growth rate we will not be able to collect the impact fees to help pay for these projects. It
could cause the GPF (Groundwater Preservation Fees) to be further increased to pay the
debt for CAP water development.
Mr. Ruiz discussed the options and preliminary cost estimates for wheeling of CAP Water.
Short Term Interim Wheeling thru Tucson Water at 1,000, 1,500 and 3,000 AF/Year
Description of Project: Recharge O.V. CAP water in Tucson Water's recharge basins. Staff
is still working on Tucson's Water Cost Study.
Reviewed: Preliminary costs for Short Term Interim Wheeling:
1,000 AF: Capital Costs ($50,000), Sunk Cost ($10,000), Tucson Water Delivery
($562,000), CAP Water ($135.000), Debt Service ($0), Cost per AF ($708), Power Savings
($119,780), CAGRD Savings ($201,087), GWA Savings ($0), Adjusted Cost per AF ($387),
Earliest Timeline: January 2012
1,500 AF: Capital Costs ($515,000), Sunk Cost ($103,000), Tucson Water Delivery, CAP
Debt Service, Cost per AF, Power Savings, CAGRD Savings, Adjusted Cost per AF = $445
Earliest Timeline: January 2012
3,000 AF: Capital Costs ($6,619,000) Sunk Cost ($1,686,000), Cost per AF= $678, Earliest
Timeline: January 2013
Mr. Ruiz gave an explanation about the sunk costs and Oro Valley's infrastructure needs
for the various options 1,000 AF thru 5,000 AF/YR of CAP water deliveries.
Mr. Ruiz explained that Oro Valley could have Interim Wheeling from 1,000 or 1,500 AF/YR
for a number of years before moving forward with the 3,000 AF/YR delivery scenario. He
explained that in about 5 years Tucson Water's TDS (Total Dissolved Solids) may start to
rise. When we begin our TDS could be at a range of 300 TDS and blending may not be
necessary. There will be some blending in the system when we reach 3,000 AF/YR in 5
years, the TDS could rise and the possibility of more infrastructure exists.
Long Term Scenarios Phase 1: Staff is currently working on two studies Recharge and
Recovery and Direct Treatment & Delivery. The Capital costs for both these Options are
preliminary and could change. As the studies progress the cost estimates will become more
defined. The cost per AF and adjusted cost per AF for both options are undetermined.
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Delivery Option 1- Timeline: Earliest July 2015
Delivery Option 2- Timeline: Earliest January 2016
Mr. Ruiz indicated that the goal will be to keep the groundwater production not much
over the sustainable annual production rate.
Ms. Seng mentioned that the preliminary costs were estimates based on Tucson Water's
projections and CAGRD future rates. If these projects do not occur within our timelines the
costs and savings could be significantly different.
-Does capital cost build on each other as we proceed with the short term options 1,000 thru
3,000 AF/Year? (Commissioner Milkey). Mr. Ruiz explained that they were separate stand
alone estimates. Mr. Saletta also explained that the table was prepared to compare the
various projects so that the Commission could see what the costs were per acre foot for
each project.
-On the Long Term Option 2 Direct Treatment & Delivery does it require building a
reservoir? (Commissioner Tustison). Mr. Ruiz mentioned it would require a receiver/storage
tank or by pass pump station, so it would not require a large storage reservoir. He also
explained that the costs were based on Oro Valley doing the projects solely on their own.
-When we go with the 1,000 and 1,500 Interim Wheeling can we use this infrastructure for
the Long Term Projects? (Commissioner Shapiro). Mr. Ruiz explained in terms of 1,500
AF system we could use some of the equipment and pipeline used for the 1,000 AF
system. In addition, the pipeline infrastructure for the 1,500 AF system can be used for the
Long Term options. The Utility would not need to borrow money for the 1,000 and 1,500 AF
system.
Mr. Saletta pointed out that Oro Valley could begin the 1,000 AF project for 1 or 2 years
then move forward with the 1,500 AF in 2 to 3 years, and the 3,000 AF to possibly 5 years.
However this will need to be discussed with Tucson Water.
Commissioner Tustison felt given the economic situation in the country that the 3-5 year
growth rate would be slow. If the growth rate increases how much time will it take to go
from the Short Term to the Long Term program?
Mr. Ruiz mentioned that the growth rate indicators have to be analyzed year to year. We
must implement the appropriate levels based on demand and that we are sustaining
growth.
Mr. Saletta explained that the financial funding must be in place before taking on the
$65,000,000 Recharge and Recovery project. It could take place in 3 years, but we have
some lead time if we get started on the Short Term projects.
Commissioner Milkey felt it was prudent to go ahead with the Long Term evaluation
process even if we deferred the start date. If Staff makes a decision on Recharge &
Recovery or Direct Treatment and Delivery and everything is in place, then we could move
much faster. We should continue refining our understanding and planning even if the
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economic indicators are not there. Mr. Ruiz mentioned as we move along, we must review
the projects and the need for further studies exists.
-Will we have to finance any of the planning for Option 1 or 2 Long Term projects?
(Commissioner Davis). Mr. Saletta explained that the funds could be taken from the
Alternative Resources Development Impact Fee Fund. The preliminary plans are not that
costly, however the design portion is. It also depends how much we want to spend and
increasing the GPF along the way. We want to minimize the increases to the GPF because
much of the funding will also come from the Alternative Impact Fee Fund.
-What do we need to get started and can we vote on a plan now and forward it to Council?
(Commissioner Shapiro). Mr. Saletta felt it would take a while, and that it was strictly up to
the Commission. He encouraged the Commission to wait until further progress was made
because there were still several items that needed to be developed in the table. Mr. Saletta
emphasized that the Council and Commission need to see how these projects will
affect water rates and this still needs to be completed.
Chair Powell indicated that the table was on the agenda as an information item only, and
we must realize Staff still needs to re-define several areas.
Commissioner Milkey felt a decision and conclusion should be made on the 1,000 AF per
year Short Term Option. We need to know the cost estimates and how it will impact the
water rates. Commissioner Milkey asked if Staff could have the water rates information in a
month. Ms. Seng indicated that she could provide some information on the two Short Term
options.
Ms. Seng believed that she could provide the information by February and emphasized that
for each option there would be a five year proforma.
Commissioner Milkey felt that the best approach would be to implement option 1 and
possibly move up to the 1,500 AF/YR project.
Mr. Ruiz explained the design and construction timeline for the 1,500 AF project and also
emphasized the costs and impact to the customers. He also mentioned that the costs
associated with the short term projects may be available by February but we need to
finalize the price with Tucson Water. The possibility of reducing the $562 per AF amount is
strictly dependant on capital costs and certain O&M charges. When the negotiations are
complete a draft agreement can be developed and presented to Council for approval. All of
these steps must be taken before Staff can begin to work on the design process. Mr. Ruiz
pointed out the advantages and disadvantages for each option.
Ms. Seng reported that she would have to evaluate the increases in the budget, analyze all
the projections and costs associated with the projects to determine how it impacts the rates
in a five year period. Ms. Seng also pointed out there would be additional O&M costs. Ms.
Seng also emphasized avoiding rate shock.
Commissioner Tustison asked about the pending Joint Study Session with Council to
discuss the Comprehensive plan. Mr. Saletta mentioned that the Joint Study Session had
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1/10/2011 MINUTES, ORO VALLEY WATER UTILITY COMMISSION
not been scheduled but could take place in March. Commissioner Tustison felt strongly that
the Commission should meet with Council first before taking any definitive steps.
Mr. Saletta explained that the budget could increase by $387,000 if Oro Valley proceeded
with the projects stand alone. He mentioned that an analysis must be performed with each
of these projects.
Commissioner Milkey indicated that he would be fine waiting on the 3,000 AF and the Long
Term projects, but we need to get some of the Short Term projects on the way and in place
for approval.
Ms. Seng said, we need to know first hand the impact to the rate payers and the
preliminary costs before these projects go to Council for approval.
Mr. Saletta agreed that Staff could move quickly on the 1,000 and 1,500 AF/Year options
but we also need to continue to work on the other projects. We must be certain we are
moving in the right direction.
Commissioner Tustison complimented Staff for a great job and making things clearer by
presenting the table.
Commissioner Milkey also felt that the Interim Wheeling of CAP water through Tucson
Water was a very clever idea.
Mr. Saletta reviewed several areas of the Phase II projects such as costs, full treatment
and delivery, reverse osmosis and reduction of TDS. He asked if the Commission wanted
a summary report with project descriptions, facility maps, graphs, timelines and a
comparative table. The Commission felt it was a good idea but was not necessary to do
right away.
Commissioner Shapiro felt that narrowing the projects to five year terms would make things
simpler for Council's approval.
Chair Powell explained that as the Commission starts to understand how things operate it
will help with educating the community and Council.
There were no further comments. No Action was required on this item. Chair Powell felt
there was great input from the Commission.
3. REGIONAL WATER ASSESSMENT THINK TANK (P. Saletta) Discussion
and/or possible action regarding the recent Regional Water Assessment Think Tank
Session that was conducted by the Pima Association of Governments.
Mr. Saletta reported that he attended the regional water assessment Think Tank meetings
at Pima Association of Governments. The basic concept was to find out the community's
thoughts about water.
The participants were asked various questions:
-What regional water issues need to be addressed? All of the comments could be seen and
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1/10/2011 MINUTES, ORO VALLEY WATER UTILITY COMMISSION
evaluated by the attendees.
-What could the water use priorities be at a regional level?
-How can water resources be managed at a regional level?
-How can water use be managed more at a conservation level?
-How can water infrastructure for the region be funded?
Four to five meetings were held. The data has not been finalized but Staff will keep the
Ccmmission informed.
There were no comments or questions. No Action was required on this item.
4. UPDATE ON CAPITAL PROJECTS (D. Ruiz & R. Jacklitch) Discussion and/or
possible action regarding the current capital projects that are being designed or
constructed by the Water Utility.
Click here for Item #4
Mr. Jacklitch presented a power point presentation: Photos- 3.0 million gallon Potable
Water reservoir (reservoir concrete floor is complete, 2 sections of vertical wall has been
poured).
-Well at Tangelo (Control building wall is complete) -Location: Tangelo Drive & 1st Avenue
-Completion: March 2011
N. La Canada 24" Pipeline: Construction begins: January 2011 -Location: Moore Rd. &
King Air Drive
Commissioner Tustison asked what is the cost for the new well. Mr. Jacklitch indicated that
the construction contract was about $400,000 however the well drilling was about
$600,000. The well is about 800 feet deep with 14 inch casing, depth to water
approximately 254 feet from land surface.
Design Projects:
-Chlorine storage building relocation -Location: Reclaim facility
-Campo Bello Water Main Replacement: Location: South of Calle Concordia
-Lambert Lane Water Main design is complete -Bidding to take place March 2011
-Joint project with Public Works Department road widening project
-El Conquistador Booster station: The design work for this project is complete -Staff
continues to work with Hilton staff on the construction easement. There were no further
questions. Mr. Jacklitch ended his report.
5. CUSTOMER SERVICE UPDATE (S. Seng) Discussion and/or possible action
regarding the meter report and customer service activities.
Click here for Item #5
Ms. Seng reported on the Customer Service Report
Meter Installation as of December 31, 2010
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1/10/2011 MINUTES, ORO VALLEY WATER UTILITY COMMISSION
-Actual Metered Installations as of 12/31/10: 33
-Projected new meters for FY 10-11: 75 Tracking: 66
-Projected EDUs for FY 10-11: 94
-Actual EDUs as of 12-31-10: 59
Meter Replacements
CY 2009 thru CY 2010 = 1,100
Ms. Seng reported that prior to the Meter Replacement program the Utility only replaced
504 meters over a period of 7 years.
E-Bill Enrollment: 432 accounts currently enrolled
On Line Payments: Started: August 2009, 9,301 payments received
$ 947,033 total amount received
$ 102 average amount of each payment
Oro Valley Water Ways Conservation Newsletter: The newsletter is published in the Oro
Valley Vista the Vista is published once a month and is only available on line:
www.orovalleyaz.gov. Also, customers have access to and can view their water use
history on Water on the Web.
Commissioner Tustison asked about the 1,100 meter replacements. Is there more water
being used now than with the old meters? Ms. Seng indicated that there has been an
increase but it was difficult to do a comparative analysis. Ms. Seng also reported that the
Utility changed out several large meters including a 6-inch meter at Honeywell. There were
no further questions, Ms. Seng ended her report.
6. TOWN COUNCIL MEETINGS/COMMUNICATIONS (Councilmember Gillaspie)
There were no Council representatives present. No report was given.
7. SUBCOMMITTEE/COMMISSIONER REPORTS
a. Finance Subcommittee (Commissioner Tustison)
Commissioner Tustison had no report.
b. Conservation Subcommittee (Commissioner Davis)
Vice Chair Davis reported that the subcommittee did not meet but was currently working
with Planning to develop standard operating procedures for implementation of the current
Landscape Ordinance.
c. Renewable Water Resources Subcommittee (Commissioner Hoffmann)
Chair Powell mentioned that the subcommittee met last week regarding the
Comprehensive CAP Water Development Plan. Commissioner Hoffmann also reported that
there was still extensive work to be done on the plan.
8. STAFF REPORTS
a. Potable and Reclaimed Water System Report (D. Ruiz)
Click here for Item "A" Potable Water System Report - December 2010
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1/10/2011 MINUTES, ORO VALLEY WATER UTILITY COMMISSION
Click here for Item "B" Reclaimed Water System Report - December 2010
Potable Water System - December 2010
-Demand Daily Demand: 6.0 million gallons per day dropping off to 4.0 milliong allons.
-Precipitation: 4 rain events
-Reservoir levels: 7 million gallons
Reclaimed Water System - December 2010
-December Usage = 26.0 million gallons per day
-Year 2010 Total = 648.0 million gallons used
Chair Powell also indicated that the golf courses were using less water.
9. DIRECTOR'S REPORT (P. Saletta)
a. Upcoming Meetings
-1/11: 10:00 a.m. Sun City Presentation
-1/12: Town of Marana & Oro Valley Joint Council meeting
-1119: Town Council meeting
-1/28: 8-9:30 a.m. Reclaimed Water Forum
-2/02: Town Council meeting Topic: CAP Reliability Agreement approval
-2/14: Water Utility Commission Topic: Presentation from CAP Staff on Colorado River
issues
b. Update on Lake Mead and Lake Powell
Click here for Item "B.1"
Click here for Item "B.2" Snowpack Information
Packet information: BOR Report Update Lake Powell is 59% full
-Lake Mead 40% Elevation level: 1086.28
Snowpack Report: Snow pack is 130% in some areas
Mr. Saletta ended his report.
10. FUTURE AGENDA ITEMS: No suggested items at this time.
CALL TO AUDIENCE - At this time, any member of the public is allowed to address the
Water Utility Commission on any issue not listed on today's agenda. Pursuant to the
Arizona Open Meeting Law, individual Commissioners may ask Town Staff to review the
matter, ask that the matter be placed on a future agenda, or respond to criticism made by
speakers. However, the Water Utility Commission may not discuss or take legal action on
matters raised during "Call to Audience." In order to speak during "Call to Audience"
please specify what you wish to discuss when completing the blue speaker card.
There were no speakers.
11. NEXT MEETING: FEBRUARY 14, 2011 LOCATION: HOPI CONFERENCE
ROOM
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1/10/2011 MINUTES, ORO VALLEY WATER UTILITY COMMISSION
ADJOURNMENT: 7:20 a.m.
MOTION: A Motion was made by Commissioner Reynolds and Seconded by
Commissioner Shapiro to adjourn.
MOTION carried, 7-0.
Prepared by,
/J9,&cpr
Iris L. Chaparro
Senior Office Specialist
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